[Federal Register Volume 77, Number 97 (Friday, May 18, 2012)]
[Proposed Rules]
[Pages 29575-29579]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-12123]



22 CFR Part 121

RIN 1400-AD13
[Public Notice 7883]

Amendment to the International Traffic in Arms Regulations: 
Revision of U.S. Munitions List Category XIII

AGENCY: Department of State.

ACTION: Proposed rule.


SUMMARY: As part of the President's Export Control Reform effort, the 
Department of State proposes to amend the International Traffic in Arms 
Regulations (ITAR) to revise Category XIII (materials and miscellaneous 
articles) of the U.S. Munitions List (USML) to describe more precisely 
the materials warranting control on the USML.

DATES: The Department of State will accept comments on this proposed 
rule until July 2, 2012.

ADDRESSES: Interested parties may submit comments within 45 days of the 
date of publication by one of the following methods:
     Email: DDTCResponseTeam@state.gov with the

[[Page 29576]]

subject line, ``ITAR Amendment--Category XIII.''
     Internet: At www.regulations.gov, search for this notice 
by using this rule's RIN (1400-AD13).

Comments received after that date will be considered if feasible, but 
consideration cannot be assured. Those submitting comments should not 
include any personally identifying information they do not desire to be 
made public or information for which a claim of confidentiality is 
asserted because those comments and/or transmittal emails will be made 
available for public inspection and copying after the close of the 
comment period via the Directorate of Defense Trade Controls Web site 
at www.pmddtc.state.gov. Parties who wish to comment anonymously may do 
so by submitting their comments via www.regulations.gov, leaving the 
fields that would identify the commenter blank and including no 
identifying information in the comment itself. Comments submitted via 
www.regulations.gov are immediately available for public inspection.

Director, Office of Defense Trade Controls Policy, Department of State, 
telephone (202) 663-2792; email DDTCResponseTeam@state.gov. ATTN: 
Regulatory Change, USML Category XIII.

SUPPLEMENTARY INFORMATION: The Directorate of Defense Trade Controls 
(DDTC), U.S. Department of State, administers the International Traffic 
in Arms Regulations (ITAR) (22 CFR parts 120-130). The items subject to 
the jurisdiction of the ITAR, i.e., ``defense articles,'' are 
identified on the ITAR's U.S. Munitions List (USML) (22 CFR 121.1). 
With few exceptions, items not subject to the export control 
jurisdiction of the ITAR are subject to the jurisdiction of the Export 
Administration Regulations (``EAR,'' 15 CFR parts 730-774, which 
includes the Commerce Control List (CCL) in Supplement No. 1 to Part 
774), administered by the Bureau of Industry and Security (BIS), U.S. 
Department of Commerce. Both the ITAR and the EAR impose license 
requirements on exports and reexports. Items not subject to the ITAR or 
to the exclusive licensing jurisdiction of any other set of regulations 
are subject to the EAR.

Export Control Reform Update

    The Departments of State and Commerce described in their respective 
Advanced Notices of Proposed Rulemaking (ANPRM) in December 2010 the 
Administration's plan to make the USML and the CCL positive, tiered, 
and aligned so that eventually they can be combined into a single 
control list (see ``Commerce Control List: Revising Descriptions of 
Items and Foreign Availability,'' 75 FR 76664 (December 9, 2010) and 
``Revision to the United States Munitions List,'' 75 FR 76935 (December 
10, 2010)). The notices also called for the establishment of a ``bright 
line'' between the USML and the CCL to reduce government and industry 
uncertainty regarding export jurisdiction by clarifying whether 
particular items are subject to the jurisdiction of the ITAR or the 
EAR. While these remain the Administration's ultimate Export Control 
Reform objectives, their concurrent implementation would be problematic 
in the near term. In order to more quickly reach the national security 
objectives of greater interoperability with U.S. allies, enhancing the 
defense industrial base, and permitting the U.S. Government to focus 
its resources on controlling and monitoring the export and reexport of 
more significant items to destinations, end-uses, and end-users of 
greater concern than NATO allies and other multi-regime partners, the 
Administration has decided, as an interim step, to propose and 
implement revisions to both the USML and the CCL that are more 
positive, but not yet tiered.
    Specifically, based in part on a review of the comments received in 
response to the December 2010 notices, the Administration has 
determined that fundamentally altering the structure of the USML by 
tiering and aligning it on a category-by-category basis would 
significantly disrupt the export control compliance systems and 
procedures of exporters and reexporters. For example, until the entire 
USML was revised and became final, some USML categories would follow 
the legacy numbering and control structures while the newly revised 
categories would follow a completely different numbering structure. In 
order to allow for the national security benefits to flow from re-
aligning the jurisdictional status of defense articles that no longer 
warrant control on the USML on a category-by-category basis while 
minimizing the impact on exporters' internal control and jurisdictional 
and classification marking systems, the Administration plans to proceed 
with building positive lists now and afterward return to structural 

Revision of Category XIII

    This proposed rule revises USML Category XIII, re-titled 
``Materials and Miscellaneous Articles,'' to advance the national 
security objectives set forth above and to more accurately describe the 
articles within the category, in order to establish a ``bright line'' 
between the USML and the CCL for the control of such articles.
    Paragraph (a) is removed and placed in reserve; the articles 
currently controlled there (i.e., cameras and specialized processing 
equipment) are to be controlled in revised Category XII or the CCL, 
which will be the subject of a separate notice. Photointerpretation, 
stereoscopic plotting, and photogrammetry equipment ``specially 
designed'' for military use will be controlled under ECCN 0A617.e. 
Paragraph (c) is removed and placed in reserve; the articles currently 
controlled there (i.e., self-contained diving and underwater breathing 
apparatus) are to be controlled in ECCN 8A620.f. Paragraphs (d), (e), 
(g), and (h) are reorganized and expanded to better describe the 
articles controlled therein. Paragraph (f) is re-designated to cover 
articles that are classified. The articles in the current paragraph (f) 
(i.e., structural materials) are to be controlled in proposed CCL ECCN 
0C617 and in revised USML Categories VII, VIII, and XIII. Paragraph (i) 
is re-designated to control signature reduction software, with 
embrittling agents (currently controlled in paragraph (i)) moving to 
the CCL under ECCN 0A617.f. Paragraph (m) is amended to reflect the 
revisions made throughout this category.
    Finally, articles common to the Missile Technology Control Regime 
(MTCR) Annex and the USML are to be identified on the USML with the 
parenthetical ``(MT)'' at the end of each section containing such 
articles. A future proposed rule will address the sections in the ITAR 
that include MTCR definitions.

Definition for Specially Designed

    Although one of the goals of the export control reform initiative 
is to describe USML controls without using design intent criteria, a 
few of the controls in the proposed revision nonetheless use the term 
``specially designed.'' It is, therefore, necessary for the Department 
to define the term. Two proposed definitions have been published to 
    The Department first provided a draft definition for ``specially 
designed'' in the December 2010 ANPRM (75 FR 76935) and noted the term 
would be used minimally in the USML, and then only to remain consistent 
with the Wassenaar Arrangement or other multilateral regime obligation 
or when no other reasonable option exists to

[[Page 29577]]

describe the control without using the term. The draft definition 
provided at that time is as follows: ``For the purposes of this 
Subchapter, the term `specially designed' means that the end-item, 
equipment, accessory, attachment, system, component, or part (see ITAR 
Sec.  121.8) has properties that (i) distinguish it for certain 
predetermined purposes, (ii) are directly related to the functioning of 
a defense article, and (iii) are used exclusively or predominantly in 
or with a defense article identified on the USML.''
    The Department of Commerce subsequently published on July 15, 2011, 
for public comment, the Administration's proposed definition of 
``specially designed'' that would be common to the CCL and the USML. 
The public provided more than 40 comments on that proposed definition 
on or before the September 13 deadline for comments. The Departments of 
State, Commerce, and Defense are now reviewing those comments and 
related issues, and the Departments of State and Commerce plan to 
publish for public comment another proposed rule on a definition of 
``specially designed'' that would be common to the USML and the CCL. In 
the interim, and for the purpose of evaluation of this proposed rule, 
reviewers should use the definition provided in the December ANPRM.

Request for Comments

    As the U.S. Government works through the proposed revisions to the 
USML, some solutions have been adopted that were determined to be the 
best of available options. With the thought that multiple perspectives 
would be beneficial to the USML revision process, the Department 
welcomes the assistance of users of the lists and requests input on the 
    (1) A key goal of this rulemaking is to ensure the USML and the CCL 
together control all the items that meet Wassenaar Arrangement 
commitments embodied in Munitions List Category 1 (WA-ML17). To that 
end, the public is asked to identify any potential lack of coverage 
brought about by the proposed rules for Category XIII contained in this 
notice and the new Category 0 ECCNs published separately by the 
Department of Commerce when reviewed together.
    (2) The key goal of this rulemaking is to establish a ``bright 
line'' between the USML and the CCL for the control of these materials. 
The public is asked to provide specific examples of materials and 
miscellaneous articles whose jurisdiction would be in doubt based on 
this revision.

Regulatory Analysis and Notices

Administrative Procedure Act

    The Department of State is of the opinion that controlling the 
import and export of defense articles and services is a foreign affairs 
function of the United States Government and that rules implementing 
this function are exempt from Sec.  553 (Rulemaking) and Sec.  554 
(Adjudications) of the Administrative Procedure Act (APA). Although the 
Department is of the opinion that this rule is exempt from the 
rulemaking provisions of the APA, the Department is publishing this 
rule with a 45-day provision for public comment and without prejudice 
to its determination that controlling the import and export of defense 
services is a foreign affairs function. As noted above, and also 
without prejudice to the Department position that this rulemaking is 
not subject to the APA, the Department previously published a related 
Advance Notice of Proposed Rulemaking (RIN 1400-AC78), and accepted 
comments for 60 days.

Regulatory Flexibility Act

    Since the Department is of the opinion that this rule is exempt 
from the rulemaking provisions of 5 U.S.C. 553, it does not require 
analysis under the Regulatory Flexibility Act.

Unfunded Mandates Reform Act of 1995

    This proposed amendment does not involve a mandate that will result 
in the expenditure by State, local, and tribal governments, in the 
aggregate, or by the private sector, of $100 million or more in any 
year and it will not significantly or uniquely affect small 
governments. Therefore, no actions were deemed necessary under the 
provisions of the Unfunded Mandates Reform Act of 1995.

Small Business Regulatory Enforcement Fairness Act of 1996

    This proposed amendment has been found not to be a major rule 
within the meaning of the Small Business Regulatory Enforcement 
Fairness Act of 1996.

Executive Orders 12372 and 13132

    This proposed amendment will not have substantial direct effects on 
the States, on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government. Therefore, in accordance with Executive 
Order 13132, it is determined that this proposed amendment does not 
have sufficient federalism implications to require consultations or 
warrant the preparation of a federalism summary impact statement. The 
regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities do 
not apply to this proposed amendment.

Executive Order 12866

    The Department is of the opinion that controlling the import and 
export of defense articles and services is a foreign affairs function 
of the United States Government and that rules governing the conduct of 
this function are exempt from the requirements of Executive Order 
12866. However, the Department has reviewed the proposed rule to ensure 
its consistency with the regulatory philosophy and principles set forth 
in the Executive Order.

Executive Order 13563

    The Department of State has considered this rule in light of 
Executive Order 13563, dated January 18, 2011, and affirms that this 
regulation is consistent with the guidance therein.

Executive Order 12988

    The Department of State has reviewed the proposed amendment in 
light of sections 3(a) and 3(b)(2) of Executive Order 12988 to 
eliminate ambiguity, minimize litigation, establish clear legal 
standards, and reduce burden.

Executive Order 13175

    The Department of State has determined that this rulemaking will 
not have tribal implications, will not impose substantial direct 
compliance costs on Indian tribal governments, and will not preempt 
tribal law. Accordingly, Executive Order 13175 does not apply to this 

Paperwork Reduction Act

    This proposed amendment does not impose any new reporting or 
recordkeeping requirements subject to the Paperwork Reduction Act, 44 
U.S.C. Chapter 35.

List of Subjects in Part 121

    Arms and munitions, Exports.

    Accordingly, for the reasons set forth above, Title 22, Chapter I, 
Subchapter M, part 121 is proposed to be amended as follows:


    1. The authority citation for part 121 continues to read as 

    Authority:  Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 
(22 U.S.C. 2752, 2778,

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2797); E.O. 11958, 42 FR 4311; 3 CFR, 1977 Comp. p. 79; 22 U.S.C. 
2651a; Pub. L. 105-261, 112 Stat. 1920.

    2. Section 121.1 is amended by revising U.S. Munitions List 
Category XIII to read as follows:

Sec.  121.1  General. The United States Munitions List.

* * * * *

Category XIII--Materials and Miscellaneous Articles

    (a) [Reserved]
    (b) Information security/information assurance systems and 
equipment, cryptographic devices, software, and components ``specially 
designed'' for military applications (e.g., command, control and, 
communications (C\3\), and government intelligence applications), as 
    (1) Military cryptographic (including key management) systems, 
equipment assemblies, modules, integrated circuits, components, and 
software (e.g., cryptographic interfaces) capable of maintaining 
secrecy or confidentiality of information or information systems, 
including equipment and software for tracking, telemetry, and control 
(TT&C) encryption and decryption;
    (2) Military cryptographic (including key management) systems, 
equipment, assemblies, modules, integrated circuits, components, and 
software (e.g., cryptographic interfaces) capable of generating 
spreading or hopping codes for spread spectrum systems or equipment;
    (3) Military cryptanalytic systems, equipment, assemblies, modules, 
integrated circuits, components and software;
    (4) Military systems, equipment, assemblies, modules, integrated 
circuits, components, and software that provide certified or 
certifiable multi-level security, user isolation, or control of the 
exchange of or access to information between or among systems operating 
at different classification levels, and software to certify such 
systems, equipment, or software; or
    (5) Ancillary equipment ``specially designed'' for the articles in 
paragraphs (b)(1)-(b)(4) of this category.
    (c) [Reserved]
    (d) Ablative materials, as follows (MT):
    *(1) Ablative materials fabricated or semi-fabricated from advanced 
composites (e.g., silica, graphite, carbon, carbon/carbon, and boron 
filaments) ``specially designed'' for the articles in Category IV; or
    (2) Carbon/carbon billets and preforms which are reinforced with 
continuous unidirectional fibers, tows, tapes, or woven cloths in three 
or more dimensional planes.

    Note to paragraph (d)(2):  This does not control carbon/carbon 
billets and preforms where reinforcement in the third dimension is 
limited to interlocking of adjacent layers only.

    (e) Armor (e.g., organic, ceramic, metallic), active armor or 
reactive armor, and armor materials, as follows:
    (1) Developmental armor developed under a contract with the U.S. 
Department of Defense;
    (2) Spaced armor with Em greater than 1.4 and meeting 
NIJ Level III or better;
    (3) Transparent armor having Em greater than or equal to 
1.3 or having Em less than 1.3 and meeting NIJ Level III 
standards with areal density less than or equal to 40 pounds per square 
    (4) Transparent ceramic plate greater than \1/4\ inch-thick and 
larger than 8 inches x 8 inches, excluding glass, for transparent 
    (5) Non-transparent ceramic plate or blanks, greater than \1/4\ 
inches thick and larger than 8 inches x 8 inches for transparent armor. 
This includes spinel and aluminum oxynitride (ALON);
    (6) Composite armor with Em greater than 1.4 and meeting 
NIJ Level III or better; or
    (7) Metal Laminate Armor with Em greater than 1.4 and 
meeting NIJ Level III or better.
    (f) Any material that:
    (1) Is classified;
    (2) Is manufactured using classified production data; or
    (3) Is being developed using classified information.
    ``Classified'' means classified pursuant to Executive Order 13526, 
or predecessor order, and a security classification guide developed 
pursuant thereto or equivalent, or to the corresponding classification 
rules of another government.
    (g) Concealment and deception equipment, as follows (MT):
    *(1) Polymers loaded with carbonyl iron powder, ferrites, iron 
whiskers, fibers, flakes, or other magnetic additives having a surface 
resistivity of less than 5000 ohms/square and isotropy of less than 5%;
    (2) Multi-layer camouflage systems ``specially designed'' to reduce 
detection of platforms or equipment in the infrared or ultraviolet 
frequency spectrums;
    *(3) High temperature (greater than 300 deg F operation) ceramic or 
magnetic radar absorbing material (RAM) ``specially designed'' for use 
on defense articles or military items subject to the EAR; or
    *(4) Broadband (greater than 30% bandwidth) lightweight (less than 
2 lbs/sq ft) magnetic radar absorbing material (RAM) ``specially 
designed'' for use on defense articles or military items subject to the 
    (h) Energy conversion devices, as follows:
    (1) Fuel cells ``specially designed'' for platforms or soldier 
systems specified in this subchapter;
    (2) Thermal engines ``specially designed'' for platforms or soldier 
systems specified in this subchapter;
    (3) Thermal batteries (MT); or
    (4) Thermionic generators.
    (i) Signature reduction software, technical data, and services, as 
follows (MT):
    *(1) Software associated with the measurement or modification of 
system signatures;
    *(2) Software for design of low-observable platforms;
    *(3) Software for design, analysis, prediction, or optimization of 
signature management solutions;
    *(4) Radar cross section or infrared signature measurement or 
prediction software;
    *(5) Signature management techniques, codes, and algorithms;
    *(6) Signature control design methodology;
    *(7) Processes that use micro-encapsulation or micro-spheres to 
reduce infrared, radar, or visual detection of platforms or equipment;
    *(8) Multi-layer camouflage system techniques to reduce detection 
of platforms or equipment;
    *(9) Multi-spectral surface treatment techniques to modify 
infrared, visual or radio frequency signatures of platforms or 
    *(10) Shaping, active, or passive techniques to modify platform or 
equipment visual, electro-optical, radiofrequency, electric, magnetic, 
electromagnetic, or wake signatures (e.g., low probability of intercept 
(LPI) techniques, methods or applications); or
    *(11) Shaping, active, or passive techniques to modify defense 
articles' acoustic signatures.
    *(j) Equipment, materials, coatings, and treatments not elsewhere 
specified, as follows:
    (1) Laser eye-safe media including narrow band dyes/coatings and 
wide band non-linear optical material ``specially designed'' for 
goggles, spectacles, or visors that provide narrow band filtering or 
broad band limiting with optical density greater than 3 that protect 
    (i) Visible (in-band) wavelengths;
    (ii) Thermal flashes associated with nuclear detonations; or
    (iii) Near Infrared or Ultra Violet (out-of-band) wavelengths.

[[Page 29579]]

    Note:  See Category X(a)(7).

    (2) Specially treated or formulated dyes, coatings, and fabrics 
used in the design, manufacture, or production of personnel protective 
clothing, equipment, or face paints designed to protect against or 
reduce detection by radar, infrared, or other sensors at wavelengths 
greater than 900 nanometers.

    Note:  See Category X(a)(2).

    (3) Equipment, materials, coatings, and treatments that are 
``specially designed'' to modify the electro-optical, radiofrequency, 
infrared, electric, laser, magnetic, electromagnetic, acoustic, 
electro-static, or wake signatures of defense articles or military 
items subject to the EAR through control of absorption, reflection, or 
    (k) Tooling and equipment, as follows:
    (1) Tooling and equipment ``specially designed'' for production of 
low observable (LO) components; or
    (2) Portable platform signature field repair validation equipment 
(e.g., portable optical interrogator that validates integrity of a 
repair to a signature reduction structure).
    (l) Technical data (as defined in Sec.  120.10 of this subchapter), 
and defense services (as defined in Sec.  120.9 of this subchapter) 
directly related to the defense articles enumerated in paragraphs (a) 
through (h), (j), and (k) of this category. (See also Sec.  123.20 of 
this subchapter.) (MT for technical data and defense services related 
to articles designated as such.)
    (m) The following interpretations explain and amplify terms used in 
this category and elsewhere in this subchapter:
    (1) Composite armor is defined as having more than one layer of 
different materials or a matrix.
    (2) Spaced armors are metallic or non-metallic armors that 
incorporate an air space or obliquity or discontinuous material path 
effects as part of the defeat mechanism.
    (3) Reactive armor employs explosives, propellants, or other 
materials between plates for the purpose of enhancing plate motion 
during a ballistic event or otherwise defeating the penetrator.
    (4) Electromagnetic armor (EMA) employs electricity to defeat 
threats such as shaped charges.
    (5) Materials used in composite armor could include layers of 
metals, plastics, elastomers, fibers, glass, ceramics, ceramic-glass 
reinforced plastic laminates, encapsulated ceramics in a metallic or 
non-metallic matrix, functionally gradient ceramic-metal materials, or 
ceramic balls in a cast metal matrix.
    (6) For this Category, a material is considered transparent if it 
allows 75% or greater transmission of light in the visible spectrum 
through a 1 mm thick nominal sample.
    (7) The material controlled in paragraph (e)(3) of this category 
has not been treated to reach the 75% transmission level referenced in 
(m)(6) of this category.
    (8) Metal laminate armors are two or more layers of metallic 
materials which are mechanically or adhesively bonded together to form 
an armor system.
    (9) Em is the line-of-sight target mass effectiveness 
ratio and provides a measure of the tested armor's performance to that 
of rolled homogenous armor, where Em is defined as follows:

[rho]RHA = density of RHA, (7.85 g/cm\3\)
Po = Baseline Penetration of RHA, (mm)
Pr = Residual Line of Sight Penetration, either positive or negative 
(mm RHA equivalent)
ADTARGET = Line-of-Sight Areal Density of Target (kg/

    (10) NIJ is the National Institute of Justice and Level III refers 
to the requirements specified in NIJ standard 0108.01 Ballistic 
Resistant Protective Materials.
* * * * *

    Dated: May 10, 2012.
Rose E. Gottemoeller,
 Acting Under Secretary, Acting Under Secretary, Arms Control and 
International Security, Department of State.
[FR Doc. 2012-12123 Filed 5-17-12; 8:45 am]